EFRAG has issued its draft comment letter on the IASB Exposure Draft Offsetting Financial Assets and Financial Liabilities. The letter can be downloaded here. Comments are invited on the letter by 18 April 2011.

The draft comment letter supports the proposal to clarify that the right to set off the financial asset and the financial liability must be unconditional and legally enforceable in all circumstances. These criteria are currently applied under the existing IAS 32. The draft comment letter also supports the proposal to specify the disclosure requirements about rights to offset financial assets and financial liabilities of an entity and the related arrangements, including information about collateral and master netting arrangements. However it urges the IASB to consider the proposals in the ED in the context of the existing disclosure requirements in IFRS 7 Financial Instruments: Disclosures, taking into account the disclosure proposals made in other consultation documents in respect of accounting for financial instruments. This is needed to ensure that the level of guidance included in the disclosure standard remains consistent and balanced across topics.

The draft comment letter can be downloaded below . The comment deadline is 18 April 2011.